Missouri Secretary of State Robin Carnahan has announced that James McClellan, Jr., of Chesterfield, Mo., has been permanently barred from working in the securities industry after he sold more than $4 million worth of unregistered timeshare investments to Missouri residents.

Carnahan also announced sanctions against McClellan’s former employer, Huntleigh Securities Corporation, censuring the firm and requiring it to pay $100,000 for failing to supervise the agent, who sold securities “off the books.”

According to two consent orders, McClellan sold unregistered securities to 18 Missouri investors in the St. Louis area, six of whom were over 80 years old. McClellan got the group to invest more than $4.4 million in a Wisconsin timeshare resort in which McClellan is a managing member. He did not disclose to the investors that the resort was experiencing financial difficultly or that the investments were not being offered through his employer.

“It is unacceptable for financial professionals to misuse their clients’ trust. My office made sure that this broker won’t be able to work in the industry in Missouri again and that his employer knows how to better supervise its employees,” Carnahan said. “Before choosing to how to invest your hard-earned savings, always remember to call our Investor Protection Hotline to make sure the investment is properly registered.”

McClellan is barred from registering as a securities agent in Missouri. Huntleigh will be censured, and is required to pay at least $100,000 to the Missouri Investor Education and Protection Fund and more than $20,000 for the Securities Division’s costs.

Further, Huntleigh is required to hire an independent compliance consultant to review its supervisory policies and procedures and to adopt and implement the consultant’s recommendations.

Huntleigh’s failure to supervise McClellan and other deficient compliance procedures were discovered during a November 2009 for-cause, on-site audit of the firm led by the Securities Division’s Audit Unit. The Division’s investigation into the activities of former Huntleigh agents and principals is on-going.

For more information regarding Missouri investments and fraud protection, or for information regarding a company or representative, call the toll free Investor Protection Hotline at 1-800-721-7996, or visit the Missouri Secretary of State's online Investor Protection Center at www.MissouriSafeSavings.com.

What about the Meadow Ridge timeshare holders who continue to be abused by, among other things, astronomical increases in maintenance fees without even proper facility maintenance being done? The maintenance money, according to employees, is being used for salaries because the place is virtually broke. Who would love paying 750 bucks for maintenance when all you get is a few t.v. channels and the fireplace doesn't work? Or who would feel cheated to hear former employees admitting they were told to lie and say the complex was "full" whenever a time share owner wanted to use one of their "extra night" benefits that they supposedly purchased with their timeshare? Or who would want to buy a timeshare for thousands if someone honestly admitted how much the maintenance fee would be at the time of purchase? When the maintenance fees reached the same price as an upscale hotel, then I concluded that timeshare ownership is nothing more than a joke and a scam.